Decision to establish the expert group on electricity interconnector target

A draft of the Security of Gas Supply Regulation was leaked to me yesterday (21 January 2016).

Full title: ‘Proposal for a regulation of the European Parliament and of the Council concerning measures to safeguard security of gas supply and repealing Council Regulation 994/2010’. The draft document has 68 pages (40 pages plus annexes). Its structure:

Establishment of a Preventive Action Plan and an Emergency Plan (p 26)

Content of the Preventive Action Plans (p 27)

Content of the Emergency Plans (p 29)

Declaration of crisis (p 31)

Union and regional emergency responses (p 32)

Solidarity (p 34)

Information Exchange (p 34)

Gas Coordination Group (p 36)

Cooperation with the Energy Community Contracting Parties (37)

Monitoring by the Commission (p 38)

Notifications (p 38)

Exercise of the delegation (p 39)

Derogation (p 39)

Repeal (p 39)

Transitional provisions (p 40)

Entry into force (p 40)

Annexes (8 in total)

Comments

Contrary to the EU’s Energy Union motto, in this draft energy efficiency does not come first. This is a worrying sign: it is all well to have a nice motto, but the proof of the pudding is in the eating, and this draft is not in line with EU Commission’s own principle of efficiency first. Energy efficiency and renewable energy are mentioned as ‘preventive measures’ (p 19-20), but come last (sic!) in the list of demand-side measures (Annex V, p 8).

Most measures are on the supply side, not the demand-side. This goes against what the gas industry currently perceives as the biggest issue: for them, EU energy security is no longer about securing supply but about securing demand. (For recent examples see here and here.) But while the EU gas lobby wants to sell more gas, EU’s ‘Energy Union with a forward-looking climate policy’ is about the transition to a fossil-free economy: it should therefore have an exit strategy for all fossil fuels, including gas. This is why the draft’s focus should be on demand-side measures: efficiency and renewables should come first, as we need less gas, not more. (See here for a recent poll at a security conference, where 48% of the participants sees energy efficiency as the most important for EU energy security.)

The draft document does not mention that already Europe’s gas demand is falling. Depending on EU’s energy efficiency target for 2030, EU gas demand will fall even further: up to minus 42% by 2030 (EU Commission data). Since the Paris Agreement on ‘pursuing efforts to limit global warming to 1.5 degrees’ an upward review of EU’s energy efficiency target is indispensable.

In light of EU’s strategy to further decrease gas demand it is odd that, unlike the State of the Energy Union, the draft does not mention the need to ‘avoid stranded assets’.

‘Instead of doing everything to reduce gas supplies from key suppliers like Russia, gas supply security could more effectively be safeguarded by ensuring that unused alternatives are maintained. They could then be tapped into for an indefinite period in the case of supply disruption from a key supplier.’ (See here for more.)

There will be no common European gas purchase mechanism. Any gas buying cooperation will be left to the market, as long as it’s in line with competition rules. (See here and here for more.)

Recap: in my view (and at first sight) this draft document fails to link energy and climate, and therefore fails to contribute to building a future-proof EU Energy Union that is in line with EU’s climate commitments and fossil-free future. I look forward to see a new, better aligned draft before the final document is published!

Document

You can find the draft document here. If this blog is the first place you saw it, then please use its original source when sharing it, that is: please share this blog, not just the Google doc. Many thanks!